Really? That's the quote of the month as far as I'm concerned. mo·ron (môrn, mr-) n. 1. A stupid person; a dolt. 2. Psychology A person of mild mental retardation having a mental age of from 7 to 12 years and generally having communication and social skills enabling some degree of academic or vocational education. The term belongs to a classification system no longer in use and is now considered offensive. The second word pretty much sums up my response.
Has greenspan made any comments on the current situation? I think it is partialy his fault for the credit crises . He made credit rates too low for too long allowing for the crazy house prices . And also that there is no inflation .
More than likely Paliz has been called a moron his whole life and he has rationalized it as such. Kind of like to obese who rationalize they were either born that way or are simply "big boned".
Blame Greenspan. He fed the whole bubble keeping rates so low for so long even though the economy wasn't even in a recession. I highly recommend Fleckenstein's book on Greenspan, called the Age of Ignorance.
Article from Trader Daily Shalom, Bernanke (Did you happen to know that âShalomâ is our Fed chiefâs middle name? No kidding. Kind of curious, as the word can be used both as a greeting and a farewell.) Anyhoo, it seems that today that Big Ben Bernankeâs sometime critics will be using his name in the positive sense, as relief washes over the financial system. But many still wonder whether this victory â however short-lived â came a little too easily. And worse, others fret that if the Fed acted less out of reason and more out fear, what else that might mean. Morning Call: January 31 Federal Reserve Chairman Ben S. Bernanke and his critics in financial markets may finally be on the same page. The central bank reduced its benchmark interest rate by half a point to 3 percent yesterday, eight days after an emergency three-quarter point move, the fastest easing of monetary policy since 1990. The Fed left the door open to more cuts by saying in its statement that ``downside risks to growth remain.'' The decisions alleviated some of the criticism investors and economists have directed at the Fed since August, when it was still saying inflation was the ``predominant'' risk. Bernanke, 54, who tomorrow marks the midpoint of his four-year term, played down price increases in this month's statements. ``Now that the language and the moves are coordinated and they're moving very aggressively, it's hard for anyone to say the Fed isn't on top of things,'' said Ethan Harris, chief U.S. economist at Lehman Brothers Holdings Inc. Last year, investors found Bernanke reluctant to lower rates to offset a credit squeeze and found some of his statements confusing, said Harris, a former New York Fed research manager. The half-point reduction in the target rate for overnight loans between banks matched the forecast of the majority of economists in a Bloomberg News survey. Traders expect policy makers to reduce the rate to 2.25 percent by mid-year, according to futures contracts quoted on the Chicago Board of Trade. ``What the Fed is telling us is they have come to recognize that they were behind the curve, that they put more emphasis on inflation than was warranted,'' said former Fed Governor Lyle Gramley, who's now a senior adviser at Stanford Group Co. in Washington. ``This is a case now of Bernanke realizing that he really has to be exercising very strong leadership.'' Bernanke signaled the shift in a Jan. 10 speech, stressing that ``we stand ready to take substantive additional action as needed,'' a message lacking from Federal Open Market Committee statements since September. Last year, Bernanke opted to tackle a surge in banks' funding costs by lowering the rate on direct loans to banks and introducing a tool to auction funds to lenders, instead of more aggressive cuts in the benchmark rate. Now, he is using the federal funds rate to address broader, deeper declines in stocks and housing, aiming to⦠(Continue reading on Bloomberg)
Bernanke's Rate Cut, Growth Outlook Align Fed With Investors By Scott Lanman Jan. 31 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke and his critics in financial markets may finally be on the same page. The central bank reduced its benchmark interest rate by half a point to 3 percent yesterday, eight days after an emergency three-quarter point move, the fastest easing of monetary policy since 1990. The Fed left the door open to more cuts by saying in its statement that ``downside risks to growth remain.'' The decisions alleviated some of the criticism investors and economists have directed at the Fed since August, when it was still saying inflation was the ``predominant'' risk. Bernanke, 54, who tomorrow marks the midpoint of his four-year term, played down price increases in this month's statements. ``Now that the language and the moves are coordinated and they're moving very aggressively, it's hard for anyone to say the Fed isn't on top of things,'' said Ethan Harris, chief U.S. economist at Lehman Brothers Holdings Inc. Last year, investors found Bernanke reluctant to lower rates to offset a credit squeeze and found some of his statements confusing, said Harris, a former New York Fed research manager. The half-point reduction in the target rate for overnight loans between banks matched the forecast of the majority of economists in a Bloomberg News survey. Traders expect policy makers to reduce the rate to 2.25 percent by mid-year, according to futures contracts quoted on the Chicago Board of Trade. `Strong Leadership' ``What the Fed is telling us is they have come to recognize that they were behind the curve, that they put more emphasis on inflation than was warranted,'' said former Fed Governor Lyle Gramley, who's now a senior adviser at Stanford Group Co. in Washington. ``This is a case now of Bernanke realizing that he really has to be exercising very strong leadership.'' Bernanke signaled the shift in a Jan. 10 speech, stressing that ``we stand ready to take substantive additional action as needed,'' a message lacking from Federal Open Market Committee statements since September. Last year, Bernanke opted to tackle a surge in banks' funding costs by lowering the rate on direct loans to banks and introducing a tool to auction funds to lenders, instead of more aggressive cuts in the benchmark rate. Now, he is using the federal funds rate to address broader, deeper declines in stocks and housing, aiming to avoid the first recession since 2001. The Standard & Poor's 500 Index has fallen 14 percent from its October peak. `Considerable Stress' ``Financial markets remain under considerable stress, and credit has tightened further for some businesses and households,'' the FOMC said yesterday. Bernanke now looks ``pre-emptive and ahead of the curve, having cut 125 basis points in two weeks,'' said Steven Einhorn, vice chairman of Omega Advisors Inc., a New York-based hedge fund with about $5 billion under management. Earlier this month, he called the central bank ``tame, timid and tardy.'' The decision came hours after government figures showed growth slowed to an annualized rate of 0.6 percent, down from 4.9 percent in the previous three months. ``This ought to be enough, with any luck at all, to avoid a recession and put us back into fairly solid growth in the latter half of the year,'' said Gramley, who predicted yesterday's rate cut will prove to be the last. At the same time, Bernanke may have earned himself fresh criticism from some economists who claim he has gone soft on inflation and risks unleashing new asset booms and busts. `Significant' Inflation ``This Fed hasn't shown the willingness to disappoint financial markets and the expectations of rate cuts,'' John Ryding, chief U.S. economist at Bear Stearns Cos. in New York, said in an interview with Bloomberg Television. ``We are going to be headed towards more significant inflation problems.'' Yesterday's report on gross domestic product showed that consumer prices, excluding food and energy, rose at a 2.7 percent annualized pace last quarter, the second fastest in three years. ``Going forward, the Federal Reserve Board faces difficult decisions, because actions addressing difficulties in the economy and in credit markets could create unwanted problems for an already soft dollar,'' former Treasury Secretary Robert Rubin said late yesterday in a speech in New York. The dollar fell to within 1 cent of a record low against the euro yesterday, while gold hit a record of $936.61 and crude oil advanced for a fifth day, to $92.33 a barrel. The FOMC statements this month omitted mentions of risks that consumer prices may climb. Officials yesterday repeated the Jan. 22 language that they expect inflation to ``moderate in coming quarters'' and that they will ``monitor inflation developments carefully.'' The Dec. 11 statement, by contrast, said that ``some inflation risks remain'' because higher fuel and commodity costs ``may put upward pressure'' on prices. ``This is an all-out, no-recession policy with little concern about the inflation consequences,'' said Robert Eisenbeis, a former research director at the Atlanta Fed. ``The focus is on financial markets and credit disruptions.''
GREENSPAN was a "Greenhorn" in his first year at the FED in 1987. Greenspan raised the discount rate in September, 1987 and the October crash came a few weeks later. Today, we have a far more serious problem inside the banking system. This is a national emergency---a huge liquidity crisis. It forced the Republicans and Democrats into swift action--to pass a TAX CUT. The current problem is much bigger than most people realize. There will be hedge funds reporting big losses. And the banks will finally reveal what they have been hiding. And the brokers will lay off 40,000 people. And bankruptcies. And mergers and consolidations. And new agencies created to try to save the day. Bernanke helped bring about a soft landing. Only, this time, something broke down that may not be something easily fixed by lower rates. Something is happening that no one has seen before. And frankly, it has a lot of economists ---scared.
NO you don't blame Greenspan it's not his fault. If you want to blame anybody blame the chinese there the one's that kept the ten year bond so low even when Greenspan was trying to raise rates they are the one's that funded our housing boom. Remember that the ten year bond is what sets the mortgage rate not the fed funds rate unless you have an interest only loan.
Why are we calling Bernanke an idiot Greenspan is the moron that started all this mess. Bernanke just inherited it.....
I take that back I can't call Greenspan a moron. Who knows how bad the Nasdaq crash was and what that would have done to our economy.....maybe he had to lower the discount rate that low and keep it there that long. I'm just an armchair quarterback